Shares of Chinese smartphone company ZTE are set to resume trading after the company agreed to pay a $1.4 billion fine to the United States government, according to filings released Tuesday.
ZTE stock will be traded on the Hong Kong stock exchange Wednesday after a nearly two-month suspension. In April, the U.S. Commerce Department banned American businesses from selling parts to ZTE, effectively putting the entire company’s future in question.
After ZTE agreed to pay the fine and change up its leadership, the U.S. reversed the ban, which was originally brought about because ZTE allegedly evaded U.S. sanctions on North Korea and Iran.
“ZTE shall replace the entire boards of directors of both the Company and [Indian subsidiary] ZTE Kangxun” within 30 days of the Commerce Department’s reversal of the ban, ZTE noted in a filing.
The U.S. Senate voted for an amendment Tuesday that would strike the deal between ZTE and the administration of President Donald Trump, however. A bipartisan group of Senators approved an amendment to the National Defense Authorization Act that would reinstate the ban on American businesses from supplying ZTE.
“The fact that a bipartisan group of senators came together this quickly is a testament to how bad the Trump administration's ZTE deal is and how we will not shy away from holding the president's feet to the fire when it comes to keeping his promise to be tough on China,” Senate Minority Leader Charles Schumer said in a statement.
“The threat Huawei & ZTE pose to our national security is too great to ignore,” Republican Senator Tom Cotton added in a statement, also referring to Chinese smartphone maker Huawei.
“This amendment will help keep Americans' private info out of the hands of the Chinese Communist Party.”
The amendment would still have to be approved by the House of Representatives. Neither Trump nor ZTE commented on the Senate amendment.
By Barry Eitel in San Francisco